Do I tell my team I want to sell the business?

My long-term goal is to sell the business. We are about to start our strategic planning process, do I tell the team about my desire to sell?

I was recently helping a client develop their strategy. The nine members of the management team, plus Phil, the CEO, had got together to workshop, among other things, the “Big Hairy Audacious Goal” and five-year goals of the business. All was going well until Phil announced that his five-year goal for the business was to sell it. Nine jaws dropped and stunned silence followed.

It happened to be time for morning tea so I coerced Phil into accompanying me on the coffee run and as we headed down to the cafe we had a chat which covered two interlinking topics: transparency and personal goals.

Transparency

When I first met Phil he was the type of CEO who liked to keep details of the business private. Very few people in the company were privy to the numbers and I’m not sure that anyone other than Phil actually got to see the whole picture.

After a bit of encouragement Phil started to share the monthly results first with the management team and then with the whole company. He noticed how the employees seemed much more engaged with the business when they could see the results of their efforts and he was relieved that the topic he dreaded – how much profit he was earning from the business – had not reared its head.

Because of his success with sharing the business’s numbers Phil was floored at the reaction of his management team to his medium-term plan to sell the business. Transparency had worked so well before, what had gone wrong this time?

I applauded Phil for bringing the possibility of a sale out into the open. Although the announcement of his intentions had been a shock to the team the clarity killed any rumours.

However, the team were shocked by the talk of a sale because it would impact them personally. In Phil’s enthusiasm to share everything he forgot that nine people would be sitting around the table thinking “what about me?”.

And the answer to the “what about me” question comes in distinguishing between the CEO’s personal goals, and the business’s goals.

Personal goals versus business goals

Phil had brought up the subject of his desire to sell the business as a “goal” to add to the list of the business’s five-year goals.

What he had overlooked in doing this however was that the sale of the business was his personal goal rather than a business goal. Phil had implied that the sale of the business in five years time would be the single goal of the business, but a purchaser (not to mention the employees, suppliers and customers) wants to see a business with direction and momentum. A business whose sole goal is to sell itself rather implies a business that is stopping!

Phil quickly understood that while his desire to sell the business would have an impact on the strategy of the business, for example the management team can set the direction of the business to dovetail nicely in with prospective buyers, it was not a business goal in itself.

And so as Phil returned to the workshop with a tray of coffees he took a few minutes to explain to the team his reasons for contemplating a sale of the business. He explained how he believed the business could achieve its Big Hairy Audacious Goal and grow to a serious global player, but that while he could lead them through the first stage of this, he wouldn’t be the right person to lead all the way. He wasn’t going to “abandon” the company but at some point in time, to fuel its huge potential, he would sell the business to the right buyer.

This all made perfect sense. The management team settled down and continued to focus on the five-year goals of the business. The nine members of the management team were thus planning for a business they still very much wanted to be part of.

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Julia Bickerstaff’s expertise is in helping businesses grow profitably. She runs two businesses: Butterfly Coaching, a small advisory firm with a unique approach to assisting SMEs with profitable growth; and The Business Bakery, which helps kitchen table tycoons build their best businesses. Julia is the author of “How to Bake a Business” and was previously a partner at Deloitte. She is a chartered accountant and has a degree in economics from The London School of Economics (London University).